KSS Kohls Corporation

Kohl’s Corporation (NYSE:KSS) today reported results for the three and nine month periods ended October 28, 2017.

      Three Months Ended     Nine Months Ended ($ in millions)     2017     2016     Change     2017     2016     Change Total sales     $   4,332     $   4,327     0.1%     $   12,319     $   12,481     (1.3)% Comparable sales 0.1 % (1.7 )% — (1.0 )% (2.4 )% — Gross margin 36.8 % 37.1 % (30) bp 37.6 % 37.4 % 15 bp Selling, general, and administrative expenses $ 1,095 $ 1,080 1.4% $ 3,053 $ 3,074 (0.7)% Reported Net income $ 117 $ 146 (20)% $ 391 $ 303 29% Diluted earnings per share $ 0.70 $ 0.83 (16)% $

2.32

$ 1.68 39% Excluding non-recurring items* Net income $ 117 $ 142 (18)% $ 391 $ 420 (7)% Diluted earnings per share     $   0.70       $   0.80       (13)%     $  

2.32

      $   2.33       0%

*Excludes Impairments, store closing and other costs in 2016.

 

Kevin Mansell, Kohl's chairman, chief executive officer and president, said, "We are pleased to report an increase in comp sales for the quarter as the traffic momentum we saw in the first half of the year continued. We saw strong results during the back-to-school season, achieving a low single-digit positive comp. The middle of the quarter was soft as we experienced disruptions from the hurricanes and other unseasonal weather. The quarter closed with strong sales in the second half of October."

Dividend

On November 8, 2017, the Kohl's Board of Directors declared a quarterly cash dividend on the Company's common stock of $0.55 per share. The dividend is payable December 20, 2017 to shareholders of record at the close of business on December 6, 2017.

Store Update

Kohl’s ended the quarter with 1,156 Kohl's stores in 49 states compared with 1,155 Kohl's stores at the same time last year. Kohl's also operates 12 FILA Outlets and four Off/Aisle clearance centers.

Earnings Guidance Update

The Company now expects fiscal 2017 diluted earnings per share of $3.72 to $3.92, which includes the impact of a fourth quarter tax settlement. The Company expects to receive a pre-tax benefit of $30 million from this state tax settlement which will be recorded through its tax rate. Excluding the impact of the tax settlement, the Company expects diluted earnings per share of $3.60 to $3.80, compared to its prior guidance of $3.50 to $3.80 per diluted share.

Third Quarter 2017 Earnings Conference Call

Kohl's will host its quarterly earnings conference call at 8:30 am ET on November 9, 2017. The phone number for the conference call is (800) 230-1085. Replays of the call will be available for 30 days by dialing (800) 475-6701. The conference ID for both the live call and the replay is 413291. The conference call and replays are also accessible via the Company's web site at http://corporate.kohls.com/investors/events-and-presentations.

Cautionary Statement Regarding Forward-Looking Information

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Kohl's intends forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “anticipates,” “plans,” or similar expressions to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, which could cause Kohl's actual results to differ materially from those anticipated by the forward-looking statements. These risks and uncertainties include, but are not limited to, those described in Item 1A in Kohl's Annual Report on Form 10-K, which is expressly incorporated herein by reference, and other factors as may periodically be described in Kohl's filings with the SEC.

About Kohl's

Kohl’s (NYSE: KSS) is a leading omnichannel retailer with more than 1,100 stores in 49 states. With a commitment to inspiring and empowering families to lead fulfilled lives, Kohl’s offers amazing national and exclusive brands, incredible savings and an easy shopping experience in our stores, online at Kohls.com and on Kohl's mobile app. Throughout its history, Kohl's has given nearly $600 million to support communities nationwide. For a list of store locations or to shop online, visit Kohls.com. For more information about Kohl’s impact in the community and how to join our winning team, visit Corporate.Kohls.com.

       

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

  Three Months Ended   Nine Months Ended (Dollars in Millions, Except per Share Data)     October 28, 2017   October 29, 2016   October 28, 2017   October 29, 2016 Net sales $4,332   $4,327 $12,319   $12,481 Cost of merchandise sold     2,737   2,720   7,693   7,812 Gross margin 1,595 1,607 4,626 4,669 As a percent of net sales 36.8% 37.1% 37.6% 37.4% Operating expenses: Selling, general, and administrative 1,095 1,080 3,053 3,074 As a percent of net sales 25.3% 25.0% 24.8% 24.6% Depreciation and amortization 243 232 724 700 Impairments, store closing and other costs     —   (6)   —   186 Operating income 257 301 849 709 Interest expense, net     74   76   225   233 Income before income taxes 183 225 624 476 Provision for income taxes     66   79   233   173 Net income     $117   $146   $391   $303   Average number of shares: Basic 166 177 168 180 Diluted 166 177 168 180   Net income per share: Basic $0.70 $0.83 $2.33 $1.68 Diluted $0.70 $0.83

$2.32

$1.68   Excluding non-recurring items* Net income $117 $142

$391

$420 Diluted net income per share     $0.70   $0.80  

$2.32

  $2.33

*Excludes Impairments, store closing and other costs in 2016.

       

KOHL’S CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited)

  (Dollars in Millions)     October 28, 2017   October 29, 2016 Assets Current assets: Cash and cash equivalents $736 $597 Merchandise inventories 4,632 4,721 Other     332   336 Total current assets 5,700 5,654 Property and equipment, net 7,974 8,203 Other assets     226   219 Total assets     $13,900   $14,076   Liabilities and Shareholders' Equity Current liabilities: Accounts payable $2,113 $2,097 Accrued liabilities 1,237 1,235 Income taxes payable 24 66 Current portion of capital lease and financing obligations     131   128 Total current liabilities 3,505 3,526 Long-term debt 2,796 2,794 Capital lease and financing obligations 1,622 1,702 Deferred income taxes 275 298 Other long-term liabilities 673 649 Shareholders' equity     5,029   5,107 Total liabilities and shareholders' equity     $13,900   $14,076      

KOHL’S CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

  Nine Months Ended (Dollars in Millions)     October 28, 2017   October 29, 2016 Operating activities   Net income $391 $303 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 724 700 Share-based compensation 34 31 Deferred income taxes 2 40 Impairments, store closing and other costs — 57 Other non-cash revenues and expenses (4) 20 Changes in operating assets and liabilities: Merchandise inventories (829) (679) Other current and long-term assets 47 20 Accounts payable 606 846 Accrued and other long-term liabilities (11) 23 Income taxes     (91)   (77) Net cash provided by operating activities     869   1,284 Investing activities Acquisition of property and equipment (547) (591) Proceeds from sale of property and equipment     18   7 Net cash used in investing activities     (529)   (584) Financing activities Treasury stock purchases (288) (441) Shares withheld for taxes on vested restricted shares (12) (15) Dividends paid (277) (270) Capital lease and financing obligation payments (101) (95) Proceeds from stock option exercises — 6 Proceeds from financing obligations     —   5 Net cash used in financing activities     (678)   (810) Net decrease in cash and cash equivalents (338) (110) Cash and cash equivalents at beginning of period     1,074   707 Cash and cash equivalents at end of period     $736   $597

View source version on businesswire.com: http://www.businesswire.com/news/home/20171109005298/en/

Kohl’s CorporationInvestor Relations:Jill Timm, (262) 703-2203jill.timm@kohls.comorMedia:Jen Johnson, (262) 703-5241jen.johnson@kohls.com